Balance billing
Billing a patient for the difference between the provider's charged amount and the plan's allowed amount, generally limited to out-of-network care.
Updated
Balance billing occurs when a provider bills the patient for the difference between the provider's billed charge and the amount the health plan allows or pays. It generally applies only to out-of-network providers, who are not contractually bound to accept the plan's allowed amount as payment in full.
In-network providers cannot balance bill because their contracts require them to accept the allowed amount as full payment for covered services.
In practice
Balance billing is restricted by the No Surprises Act in certain emergency and facility-based situations. Billing teams must confirm whether a balance bill is permissible under federal and state law before sending the patient a statement for out-of-network charges.
Commonly confused with
- Surprise billing: Surprise billing is a subset of balance billing involving unexpected out-of-network charges in emergency or in-network facility settings.
- No Surprises Act: The No Surprises Act is the federal law that restricts balance billing in specific situations, rather than the practice itself.